Changing roles how technology is transforming business functions

Changing roles: How technology is transforming business functions is an Economist Intelligence Unit report, sponsored by Microsoft.. Advisory board interviewees Deanie Elsner, former chi

Changing roles: How technology is transforming business functions is an Economist Intelligence

Unit report, sponsored by Microsoft It explores how the workplace is evolving and the effect technology will have on how people collaborate, form global teams and make decisions across various business functions

The Economist Intelligence Unit bears sole responsibility for the content of this report The findings do not necessarily reflect the views of the sponsor

The report draws on two main sources for its research and findings:

l A survey that included responses from 608 business executives globally Half of respondents are from companies with US$500m

or less in annual revenue, 15% with revenue of US$500m-1bn, 16% with US$1-5bn, 8% with US$5-10bn and 10% with more than US$10bn

Respondents are distributed evenly among five functional “buckets”: Finance, IT, HR, Marketing and Sales, and Other

l A series of in-depth interviews with members of our advisory board who were selected for their expertise in this area We also conducted interviews with other senior executives and industry experts

Advisory board interviewees

Deanie Elsner, former chief marketing officer, Kraft Foods

Mani Gopalakrishnan, senior leader for digital learning and technology, GE

Dennis Hewitt, treasurer, Omnicom Group Bank, and CEO, Omnicom Capital

Abhi Ingle, senior vice-president big data and advanced solutions, AT&T

Dana Landis, vice-president, talent research and analytics, Korn Ferry Institute

Briefing paper interviewees

Dr Carl Benedikt Frey, co-director, Oxford Martin Programme on Technology and Employment at Oxford University

Gordon Graylish, vice-president general manager enterprise solutions, Intel

Mayur Gupta, global head, marketing technology and innovation, Kimberly-Clark

Vinod Kumar, managing director and CEO, Tata Communications (India)

Mark Nasr, managing director, corporate strategy, United Airlines

Helen Souness, managing director, Australia & Asia, Etsy

We would like to thank all interviewees and survey respondents for their time and insights The report was written by Jane Bird and edited by Gilda Stahl

Preface

Technology has had a profound impact on the workplace for several decades But the pace of change has quickened and is beginning to have a hugely disruptive effect on business And the upheaval is only expected to intensify over the next few years

Changing roles: How technology is transforming business functions, a report written by The

Economist Intelligence Unit (EIU) and sponsored

by Microsoft, probes workplace transformation in the midst of change The report is based on a global survey, advisory board findings and in-depth interviews with industry experts

Organisations are using technology to create new business models, move closer to customers, and improve productivity and innovation But at the same time, they are suffering from more complexity, difficulty keeping skills up to date and increased interdependence These challenges are exacerbated by rapid change in customer expectations and work culture

While executives see technology as a way to achieve more at work and enhance job satisfaction, these benefits are often undermined by increased time and competitive pressure as organisations seek to do more with less

Automation will undoubtedly cause many jobs to disappear But new roles will be created and not all

functions will be similarly affected Our research looks in detail at the impact of technology on finance, human resources (HR), marketing and information technology (IT)

Overall, technology can be a huge source of strength and competitive advantage in the workplace But it may also increase pressure on people and reduce their professional satisfaction, harming staff well-being and business

performance Organisations need to understand both challenges and opportunities if employees are

to realise their aspirations

Key findings

lWork will become more complex Individual

workloads will increase, driven partly by the need

to respond to rapidly swelling quantities of real-time data from automation of all kinds and from greater demands for collaboration Thirty-six percent of survey respondents expect work to become more complex and 26% of respondents, across all functions, believe it will involve much greater amounts of data Globalisation and the growing interconnectedness of companies and sectors will also multiply the number of variables companies must take into account

Executive summary

lLack of time is the biggest challenge The

ability of technology to help people do more with less does not always help executives save time

Some 45% of survey respondents cite time constraints as their prime problem, with people who feel they are successful in their current role most affected—46% compared with 39% of those who believe they are not successful

lCollaboration is crucial Team-working is the

new normal both locally and globally Thirty-five percent of survey respondents believe work will require co-ordination between more people across multiple functions Collaboration is the best way to make the most of individual expertise, respond swiftly to business problems and boost competitiveness HR must optimise use of specialists and freelancers, and employees across functions must work with these temporary colleagues

lGaining new technology skills is the best way

to advance professional goals In the face of

increased automation and technological advances, all organisational functions recognise the need to keep learning Nearly a quarter (23%) of

respondents include mastering new technology in their top-three ways to achieve career aspirations

Thirty-two percent cite acquiring new skills through education and training as the opportunity most likely to help them achieve their professional goals This is becoming more important with the rise of millennials who are much more

knowledgeable about technology than most of their seniors

According to “The Terminator” view of technology, machines are taking over and ultimately all our jobs will disappear This vision has captured the imagination of science fiction movie audiences since the early 1980s, but in the foreseeable future

it looks unlikely

In reality, technologists are focused on a model more like “Iron Man”, that is, the augmented human aided by technology that can improve productivity, profitability, customer service and innovation

Technology tools can make it easier to respond

to changing market requirements, take advantage

of big data insights and collaborate

They also have the potential to help executives achieve their goals of building new products and businesses, managing larger teams, gaining promotion, leading business units and improving pay and performance Harnessed effectively, they can enable huge market disruptions

The survey suggests that this is already happening Respondents who describe themselves

as “successful” are much more likely to use new technology tools in their work, to anticipate their continued adoption and utilisation, and to perceive them as having a positive effect on their career

They have higher expectations to leverage new technologies to get more work done in the same time, and to free up more time for strategic and creative work

But deploying technology effectively is growing harder With increased globalisation, competition and technical innovation, executives believe jobs will become even more demanding and complicated, involving a larger number of

constituents and still higher customer expectations Nearly half of survey respondents say they can

do more in less time thanks to technology, and a similar proportion say it lets them work more flexibly Four in ten say technology frees up time for strategic and creative work, and 38% say it helps collaborate with remote geographies But nearly half of survey respondents say time constraints are a significant problem, suggesting that some organisations are simply using technology to add to people’s workloads

Maximising the potential of technology will require constant reskilling for staff at every level

HR professionals will need to have a better understanding of individuals’ expertise Talent will become a commodity brought in when necessary,

in every function, and much more use will need to

be made of temporary experts

Cultural change is also essential Organisations will need to introduce more flexible and

collaborative working environments that appeal to millennials, whom they must attract and retain

Introduction

The good news is that the vast majority of executives—86% of respondents—describe themselves as successful in their careers, feel they have realised their potential and are optimistic about their career growth prospects However, many say their working lives are made more difficult by lack of time, money and opportunities

Weak leadership and poor collaboration are other common complaints

Technology creates some of the most pervasive challenges Big data, powerful analytics software and high-speed Internet communications bring

huge opportunities for organisations to move closer to customers But work has become more complex, workloads are increasing and individuals often struggle to keep their technology skills up to date Meanwhile, customer expectations are constantly rising, fuelled by increased competition and the spread of social media

In one sense, business is becoming simpler because it is increasingly focused on the customer

“The customer is the new CEO,” says Deanie Elsner, former CMO, Kraft Foods But this makes roles such

as marketing more complicated, says Mayur Gupta,

Work becomes more complex

1

Source: Economist Intelligence Unit survey, 2015.

What is the greatest challenge you face in achieving your professional goals?

Select up to three.

(% respondents) Not enough time

Insufficient financial resources

Lack of opportunity

Unsupportive organisational culture

Weak organisational leadership

Not enough authority to act

Lack of internal collaboration and/or teamwork

Insufficient technology tools

Lack of education and/or training

Personal biases (eg, gender, race, age, religion)

45 28

26 18

17 14 14 9

8 5

global head, marketing technology and innovation, Kimberly-Clark, because marketers need expertise

in areas such as data analysis, technology and content in addition to their traditional skills

“‘Customer centricity’ also means you need people who have a higher risk tolerance,” says Dana Landis, vice-president, talent research and analytics, Korn Ferry Institute “They need to be able to handle variability and ambiguity.” Even in manufacturing, these skills are essential, says Gordon Graylish, vice-president general manager enterprise solutions, Intel “Five years from now, every factory machine will be intelligent and everyone will have to understand analytics,” Mr Graylish says

Technology can enhance job satisfaction

Technology helps companies be more proactive, predictive, productive and personalised in their approach Organisations can use it to enter new markets more efficiently, develop innovative business models, introduce products and services, and forge closer links between IT and lines of business

Cloud computing, for example, is liberating organisations from the need for in-house IT systems, which are expensive, time consuming and difficult to maintain By using pay-as-you-use cloud services and handing over the management

of applications and data to third-party providers, companies can improve flexibility, reduce

Source: Economist Intelligence Unit survey, 2015.

How do you expect your individual workload to change over the next 18 months?

(% respondents)

It will increase significantly

It will increase slightly

It will not change

It will decrease slightly

It will decrease significantly

25 49 23

2 1

Source: Economist Intelligence Unit survey, 2015.

In which ways do you expect new technologies (eg, mobile, cloud, big data) to impact your individual role in the next 18 months?

Please select all that apply

(% respondents) Enable you to get more work done in the same period of time

Allow you more flexibility to work from home or while travelling

Free up more time for strategic, creative and value-creating activities

Allow you to collaborate in real time with people located in remote geographies

Create the expectation that you can be available for work-related communications anywhere, anytime

Allow you to make data-driven decisions in real time

Enable you to be less dependent on other employees and functions

Enable you to receive input or feedback from a broader network of people

49 48 40

38 35 26

24 22

❛❛

‘Customer

centricity’ means

you need people

who have a higher

VP talent research and

analytics, Korn Ferry Institute

overheads and benefit from constant cutting-edge technology

The EIU survey demonstrates that where cloud services are used, they can make work easier and more satisfying Some 36% of respondents say cloud storage and sharing technologies are having

a positive effect on their career Among the office technology tools we surveyed, cloud storage, along with videoconferencing, was forecast to have the biggest percentage increase over the next 18 months

Respondents who describe themselves as successful are more likely to use cloud-based business technology More than half (59%) expect

to do so either regularly or extensively in future compared with just 34% of “unsuccessful”

respondents Overall, heavy cloud users forecast an increase in use of several business technologies, the biggest jump being in “automation of tasks”, predicted by 53% However, heavy cloud users are more likely to anticipate a heavier workload—83%

versus 65% of light cloud users

Access to more affordable and accessible technology tools can also undermine IT strategy by

the relative ease with which new applications can

be developed This has led to a phenomenon known

as “shadow IT”—the emergence of IT systems specified and deployed by business units other than centralised IT While being an important potential source of innovation, this also has the potential to undermine control, documentation and security

Don’t rush to the data mine

Technologies such as cloud computing, mobile and the Internet of Things are enabling organisations

to make increased use of real-time data in strategic decision-making However, Mark Nasr, managing director, corporate strategy, United Airlines, says management teams can suffer from information overload if data are not synthesised and viewed in context so that the patterns are clear There is also the risk of reacting tactically rather than

strategically, he notes

Looking at information in real time doesn’t necessarily provide a full view of why customers are acting in a certain way, and the danger can be responding too quickly or emotionally, Mr Nasr

Source: Economist Intelligence Unit survey, 2015.

Which of the following technologies will be most helpful in realising your professional goals?

Select up to two

(% respondents) Email

External social media

Internal social tools

49 25

15 14 14 12 11 10 10 9 9 4

says “For example, social media, though wonderful and powerful channels, can spin out of control and overemphasise one direction.” Even a little extra time can improve objectivity and allow space for objective, reasoned and longer-term decisions, Mr Nasr believes.

The challenge for organisations is to let executives use some of the time savings of technology to pause and reflect rather than just take on more work Another problem is the lack of easy, accessible tools with which to manage the data

The current enthusiasm for data mining is “a little bit like a gold rush”, says Ms Landis

“Everyone’s running towards the data But there’s

a lot of spurious information and random correlations that aren’t telling you anything It’s very hard to find the signals in the noise.” In future, she says, “there will be a lot more focus and homing in on the signals that provide an answer to the ’What now?’ question.”

Companies also need to focus on many more areas than previously because continuous convergence is happening across sectors such as food, energy, health, IT, manufacturing, transport and urban development Vinod Kumar, managing director and CEO, Tata Communications (India), says, “At Tata Communications, in the past two years we have had to drive our learning of trends across many of these industries to help understand what could happen and how it applies back to our business, for example, where to locate data centres.”

aren’t telling you

anything It’s very

hard to find the

The need to collaborate and work in diverse and geographically dispersed groups is a growing business challenge Some 45% of survey respondents say collaboration will become increasingly important

However, Mayur Gupta, global head, marketing technology and innovation, Kimberly-Clark, says that people find it difficult to change their behaviour “While we pay lip service to collaboration, we still operate in traditional ways and isolated verticals because that is easier,” he says “We are still very channel- and technology-obsessed instead of being customer-focused It hasn’t become second nature and is not in our muscle memory.”

That said, collaboration is beginning to happen, for example, in financial departments Dennis Hewitt, treasurer, Omnicom Group Bank, and CEO, Omnicom Capital, anticipates that further technology-driven changes in finance will accelerate the decision-making process and technology will enable the availability of more precise information in a timely manner “Teams will

be formed with members that have relevant skill

sets More experienced members will be matched with younger, more technologically skilled members to address the issue before them Team decision-making will become more common with accountability being shared,” he says

Helen Souness, managing director, Australia & Asia, Etsy, sees global virtual teams as the most effective way to address increasing market disruption These teams need autonomy to determine how to solve problems and innovate rapidly for different markets, she says “I think teams will be even more fluid and global, with experts from all over the world, some of whom may not be employees, forming around projects and problems.”

Software tools can make team-working easier regardless of people’s locations Videoconferencing, for example, is being deployed to competitive advantage by global organisations such as Tata Communications as a powerful tool for long-distance collaboration Yet 75% of survey respondents foresee the number of face-to-face meetings staying the same or increasing, and 77% expect the same trend in business travel

global head, marketing

technology and innovation,

Kimberly-Clark

There is little doubt that the employment landscape is evolving quickly with advances in technology Artificial intelligence and robotics can

do a lot when factories undergo upgrades or when organisations come under cost pressures, says Mr Kumar Instead of one-for-one replacement, he thinks, more work in future will be done by machines and software

There will also be new employment models, such

as organisations bringing in more specialist expertise when needed and individuals who have those skills working for multiple clients

Perhaps people will work for multiple organisations, says GE’s Mr Gopalakrishnan “Some times I wonder, ‘Why should I work for only one company when I can bring a skill set to three different companies that have the same problem?

Why can’t I do that without being a consulting firm?’

“I could be employed by three different companies to do the same thing,” Mr Gopalakrishnan continues ”And I will probably do

it at the same pace, because I’ll have all the organisational structures needed to support this.”

Abhi Ingle, senior vice-president big data and advanced solutions at AT&T, believes that people will use technology to work and collaborate in

“radically different”, multi-modal ways “You will e-mail, text, video, short-form, long-form, across boundaries of time and space It could be recorded meetings where you can jump in and jump out

convenient to you at a particular point in time or in

a particular context,” Mr Ingle continues “Your identity will just migrate into the cloud, and communication will happen across all your panes of glass.”

But so far, the digital economy has created relatively few new jobs Dr Carl Benedikt Frey, co-director, Oxford Martin Programme on Technology and Employment at Oxford University, estimates that less than 0.5% of the US workforce is employed in digital industries that did not exist before the turn of the century “A few software entrepreneurs can build a valuable business much faster than a traditional manufacturer with an assembly line—and with much less capital,” he says Over the next few decades, a massive 47% of US jobs will be susceptible to automation, says Dr Frey, from transport logistics to back-office

administration and sales However, he believes skilled professional jobs are unlikely to be replaced

by machines in the next couple of decades “There is lots of good software for sophisticated analysis, but you need human creativity, intuition and judgement

to identify the questions in the first place.” Jobs where computers are unlikely to outperform humans, says Dr Frey, include those that require creativity and social intelligence like persuasion, negotiation, managing people and caring for others

Everyone has something to offer

The other big workplace change with regard to

New skills required as job functions shift

3

❛❛

Sometimes I

wonder, ‘Why

should I work for

only one company

when I can bring a

skill set to three

senior leader for digital

learning and technology, GE

is that the most savvy people in the organisation,

in terms of technology and marketing, are frequently the youngest and most junior, says Ms Elsner “They are so much better They are native to this world Your senior and executive teams, for the most part, have grown up in a world that is very quickly going away They have no idea what’s really going on out there, and they almost have to unlearn what they’ve learned to relearn a whole new skill set You have to find a way to marry their experience and knowledge with the capability and comfort of your junior team.”

Millennials, young entrepreneurs and senior people can teach each other, says Mr

Gopalakrishnan “Many large companies are looking at start-ups to learn from them and vice versa.” GE is implementing a culture that is about bringing products to market more quickly, with principles modelled on the start-up world, Mr Gopalakrishnan says “This is about understanding that customers determine our success Winning in

an ever-changing world requires us to stay lean, fail, learn, and adapt fast, and lastly inspire and empower each other as a team.”

❛❛

Many large

companies are

looking at

start-ups to learn from

them and vice

versa.

❜❜

Mani Gopalakrishnan,

GE

The advantages of new technology are not being uniformly enjoyed across all organisational functions For example, marketing executives are proving relatively slow to gain time- and cost-savings, while HR and IT leaders are not making the most of collaborative software.

Financiers become forecasters

The link between effective deployment of new technology and satisfaction with personal and professional development can be seen clearly in the finance function Finance executives surveyed are more prone to describe themselves as very successful and are more likely to expect to leverage new technologies to make data-driven decisions

Mr Hewitt says technology-driven changes in finance will accelerate decision-making and allow more precise and timely information Instead of reviewing such things as capital budgets and projects on a calendared basis, he says, “reporting will become more dynamic and frequent as the need arises, with treasurers playing a greater role.”

Managing financial considerations such as currency movements and interest rates in real time will be crucial for global companies because of their impact on funding decisions

As the use of predictive analytics becomes more commonplace, it will be employed extensively in the finance function to detect trends, provide insights and influence decisions, Mr Hewitt says

Learning to use this technology should help

the survey, of achieving excellence and more

Mr Hewitt believes that finance will become much more closely aligned with other functions such as marketing, manufacturing, engineering and HR, providing them with information to help achieve their goals “Overall, the treasury function, which primarily has the responsibility of providing the liquidity of the corporation, will become much more important in influencing how resources are deployed,” he says

Marketers keep learning

Marketing and sales professionals are relatively more focused on using technology to work more efficiently, collaborate remotely and in real time, and having the flexibility to work from home or while travelling Far above other functions, marketing and sales professionals are attracted by the opportunities to better understand their customers’ behaviours and needs and to leverage new technologies They are significantly more inclined to think customer expectations will rise.The customer is the focal point, says Mr Gupta

“Adtech and martech will be increasingly connected, and channels combined to focus on the customer and drive seamless brand experiences that change customer behaviours You can’t think about sales and marketing in silos.”

Marketing professionals will have to keep learning or they will become obsolete Technology such as social media is creating new opportunities

treasurer, Omnicom Group

Bank, CEO, Omnicom Capital